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Mr. Al Shalash: Dar Al Alarkan Maintenance of its Corporate Rating by S&P and RAM Rating Reflects Its Transparency of Dealing with Capital Markets, Financial Institutions, and Credit Rating Agencies

Dar Al Arkan Reporting Its 1st 2011 Interim Financials in NASDAQ - Dubai in Accordance with IFRS Standards

Dar Al-Arkan released on Wednesday, September 07, 2011, its interim consolidated financial statements for the six months period ended 30 June 2011 in accordance with International Financial Reporting Standards- IFRS - together with the independent auditors' review report. Dar Al-Arkan started issuing the first IFRS financial statements in 2004 and, since then, the Company continues issuing these financial statements for the capital market's participants.

Dar Al-Arkan 's adoption of IFRS in reporting its financial statements comes from its disclosure strategy that focuses on transparency that increases credibility with the capital market's participants and the other stakeholders. Dar Al-Arkan is one of the few companies in the Middle East that issues financial information to several international stock exchanges around the world, such as, NASDAQ Dubai - UAE, London Stock Exchange - UK, Labuan Stock Exchange - Malaysia, Bahrain Stock Exchange - Bahrain.

Because of its disclosure level and practices, Dar Al-Arkan was recognized with a financial disclosure Transparency Award. This award is granted by BMG Financial Group to Saudi listed companies in Tadawul. Dar Al-Arkan was recognized with this award to be within the top 10 companies listed in Saudi Stock Market two years in a row - 2009 and 2010.

Commenting on this announcement, Mr. Abdullatif Al Shalash, Managing Director of Dar Al-Arkan stated that " Dar Al-Arkan 's ability to maintain and enhance its financial reporting and disclosure level in accordance with the local and international standards is part of our strategy aimed to provide fair, accurate and timely financial and institutional disclosures regarding the Company's financial status and other operational matters that ensures transparency and credibility".

Mr. Al Shalash added, "Such a high level of institutional disclosure implemented by Dar Al-Arkan , enables us to effectively deal with the capital market's participants and the other stakeholders, like credit rating agencies. As a matter of fact, we have recently announced in August that, Dar Al-Arkan received a reaffirmation of its "BB-" long-term corporate rating with a stable outlook from the international rating agency Standard & Poor's (S&P) after its recent review and received a reaffirmation of its "AA3/P1" long/short term corporate rating, with a stable outlook from the Malaysian Ram Rating credit agency "Ram Rating" after its last review".

The reaffirmation of Standard & Poor's and Ram Rating was granted, given that Dar Al-Arkan financial performance during the second quarter improved in comparison to the first quarter in terms of margins, collections of trade receivables and increased operating cash flow generation. DAAR also maintains sufficient leverage for its financial covenants; Shareholders' equity of $4.0 billion (minimum requirement $2.3 billion), total liabilities to total assets of 37% (maximum permitted 65%), and current ratio of 2.1x (minimum required 1.1x). In addition, DAAR has managed to generate a robust cash flow from its operation, and account receivable balances were collected and decreased from their peak during the first quarter of 2011.

On a macro level, the Saudi government injected this year SAR40 billion to the Real Estate Development Fund (REDF) that provides soft loans to Saudi citizens for the acquisition of housing. Also the Saudi government housing stimulus packages of SAR250 billion announced in March 2011 for the development of 500,000 housing units will increase demand for land and housing developments in the short to medium term.

Commenting on The reaffirmation of Dar Al-Arkan rating from both the international and regional rating agencies, Mr. Al Shalash said, "The Company's ability to retain its credit rating from S&P and Ram Rating reflects the stable financial position of DAAR and shows its capability to meet its long/short term financial obligations as well as its resilience managing against adverse changes in economic conditions and/or operating environment thus ensuring the continuity of implementing our projects". Commenting on DAAR's macro level position, he stated, "DAAR is well positioned to capitalize on the short-term with the REDF initiative and in the medium term on the housing stimulus package".

Lastly, Mr. Al Shalash added, "S&P and Ram Rating initiated coverage of Dar Al-Arkan in January 2010, and have since maintained corporate credit rating without change. This continuous reaffirmation of Dar Al-Arkan corporate credit rating by the international and regional rating agencies is indicative of the company's positive record of accomplishment within the industry and its strong position as the largest real estate developer in the Kingdom."

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© Press Release 2011